Although Egypt has made progress in intellectual property rights protection, a recent roundtable made clear that more effort is needed in terms of enforcement and public awareness. Pierre Loza reports With frequent raids taking place, and three to four month jail terms for copyright infringers being regularly meted out, recent government efforts to protect intellectual property rights (IPR) have been widely recognised. Nasser Ali Khasawneh of the international legal firm Mena Associates believes that government enforcement efforts over the last couple of years have made a substantial difference. "Egypt has done a great job over the last few years," he said. "It has reduced its piracy rate [by] over 30 points since 1996, and that has fuelled what I regard as the fastest growth in the region for the software and IT sectors." Khasawneh was speaking at a roundtable discussion on "Counterfeiting and Anti-Piracy" -- recently organised by the German Arab Chamber of Industry and Commerce (GACIC) -- which brought together a diverse panel of private and public sector voices. Despite his appraisal, Khasawneh maintains that more aggressive enforcement is still needed. He believes that if fines are increased, the deterrence effect will be much stronger, allowing the economy to reap numerous rewards. "If a further ten point reduction in piracy takes place over the next few years, Egypt will fuel a growth rate of more that 50 per cent in the IT sector," Khasawneh said. He went on to emphasise the role of the private sector in spreading public awareness and forming alliances that can help bring the IPR issue into the public arena. The government's commitment was clearly affirmed by Sherif Hashem of the Ministry of Communications and Information Technology. Hashem believes the "government is fighting piracy by setting itself as an example, and obtaining 130,000 licences for its IT operational needs". But even with government efforts and legislative attempts to deter piracy, the Egyptian market is quite drenched with counterfeit goods in most sectors, as Hany Loka of Siemens affirmed. "Counterfeit products often get through customs with very little problems. I think that is due to the fact that customs officials don't know the difference between counterfeit and genuine products," he said. Loka also complained that when counterfeit imports are detected, the importer is given the ultimatum of re-exporting or confiscation, thus often allowing him/her to deceive the system and get his products into Egypt via a different port. Alaa Ezz of the Confederation of European Egyptian Chambers pressed this point of systematic loopholes further, arguing that confiscation was a faulty and ineffective policy. "When counterfeit goods are confiscated, they are auctioned off at a cheaper price, allowing the importer to dodge customs and get his goods into the country at an even cheaper price," he said. To counter this problem, Ezz suggested the presence of a nationwide customs database that allows customs officials to identify counterfeit products. In terms of the legal framework, Law 82/2002 has paved the way for IP infringers to be hunted down. Mena Associates's Marawan El-Khouly told Al- Ahram Weekly that in just two days, 450 pieces of counterfeit automobile spare parts, used by a major local manufacturer, were confiscated. With the help of the Supply and Internal Trade Ministry's (MSIT) fraud department, catching infringers has clearly become a much more doable process. El- Khouly suggested two routes by which trademark owners could prosecute infringers. The first involves filing a complaint to the MSIT's fraud department, making sure to include documentation of trademark ownership, as well as an overview of the infringement that has taken place. If a coordinated raid verifies that an infringement did take place, the case is forwarded to the general prosecutor, who then presses charges against the infringer. If convicted, the infringer risks a hefty fine, confiscation and a jail sentence. The second route involves heading straight for a prosecution; in this case, the trademark owner takes the infringer directly to court. Although this route may be a little quicker, it is more burdensome on the trademark owner, who will have to submit sufficient proof that an infringement did take place. In any case, convincing the Egyptian consumer that buying counterfeit goods is not ethically sound will be a tough case to make. With rising prices and a shrinking middle class, many consumers are willing to sacrifice quality for a lower market price. At the end of the day, for the hard working consumer, the temptation of copying software or buying a counterfeit product is quite strong. In the short term, cheaper counterfeit products, which often originate in China, can mean happier consumers. In the long term however, flimsy IP enforcement will mean less foreign direct investment and market innovation, and slower economic growth. For the Egyptian government to attract the foreign investment it needs to reach its growth targets, a higher level of border control and monitoring is clearly essential to bolster the country's image as an attractive investment destination that respects innovation and protects IP rights.
